money can drastically improve happiness for those who can't afford the basics shelter and food

Does more money equal more happiness the short answer, yes, having money gives you the freedom to live comfortably you can eat what you want to live where you want and have what you desire to go wherever and spend time doing what you want to do without compromise however the relationship between money and happiness is not quite as simple as we've historically assumed research shows that money can drastically improve happiness for those who can't afford the basics shelter and food. But once basic survival needs are fulfilled money has less and less of an impact on happiness a person who makes fifty thousand per year is far happier than someone who makes five thousand but someone who makes fifty million per year isn't much happier than the person that makes fifty thousand in the last century the American income has tripled even factoring for inflation we have bigger houses more cars and fancier toys but surveys show that happiness has stayed the same let's examine Maslow's famous hierarchy of human needs on the bottom.

We see physiological needs otherwise known as food shelter breathing sex and sleep above that we have safety love esteem and self-actualization as we examine this hierarchy we can see that the higher you go on the pyramid the less effect money has on the need this is the very reason why money has a diminishing return on happiness at a certain point you can't buy more Bill Gates once said I understand wanting to have millions but once you get beyond that it's all the same hamburger psychologists have discovered. There are essentially two types of happiness extrinsic and intrinsic extrinsic focuses on money and material wealth image and status happiness derived from these external sources result in a short-lived dopamine spurt and the never-ending state of wanting more intrinsic happiness, on the other hand, is derived from following a passion personal growth making the world a better place or loving relationships with family and friends intrinsic happiness generates a long-lasting joy from within and is a feeling that money simply can not buy.